How sweets offered in hygienic packs are revolutionising the packaged food industry
With the Indian packaged food industry evolving and maturing in recent years, packaged sweets have come to register as an integral part of that process. In fact, the traditional popularity of sweets, coupled with an increased consumer consciousness of hygiene and cleanliness, has made sure that packaged sweets have acquired extraordinary traction.
The popularity of sweets offered in a hygienic pack is giving a fillip to the packaged food industry. In other words, packed sweets are revolutionising India’s packaged food industry.
With authorities increasingly clamping down and tightening norms around food labelling, general safety, and hygiene, this is further serving the cause of the packaged food industry.
The emerging packaged food landscape
Even before COVID-19 had ‘bared its fangs,’ the Indian packaged food sector had been on a positive trajectory. For instance, last year, it was reported how the industry had recorded an impressive over 14 percent growth for April to August period.
However, it is particularly noteworthy to see the growth despite the wider consumption slowdown. In more recent times, while western snacks have been in a high growth category, ready-to-eat foods have emerged as a high potential category.
In terms of sales, Tier I and metro markets have been the best performers, with rural and the rest of urban areas contributing almost similarly. Therefore, with a permanently large middle-class, and increasingly hectic schedules, and busy lifestyles, the room for ready-to-serve packaged food can never be enough for the Indian market, and there will always be room for growth.
Motivating factor: the sheer range of sweets available
Representing both traditional and modern, the Indian sweet market is characterised by an extraordinary array of offerings.
The range of sweets products available in India is simply mindboggling — from traditional milk-based sweets and open mithais offered by unorganised, traditional sweet shops, to sweets and confectionery products prepared by organised bakeries, to specialised milk-based products by dairy establishments, to luxury mithai brands promoted by new-age confectioners, to organic sweets by modern food brands.
Growing at a CAGR of over 12 percent for almost a decade, the Indian confectionery market is estimated at $1.5 billion.
Another research estimates that confectionery and snack market will grow by over 10 percent between 2020 and 2025; this would give a massive stimulus to the packaged food and India’s packaging industry.
The growing packaging industry
At the same time, with increasing investment in food processing industries, the rapid expansion of organised retail, and rising exports market, the Indian packaging industry has seen considerable gain. The need for improvement in shelf life, maintenance of the pace of production while upholding quality, necessarily requires higher, standardised, and quality packaging.
With the improvement in packaging methods and technologies such as the emergence of eco-friendly packagings like biodegradable, nanofabrication technologies, and the shift from rigid to flexible packaging, the food packaging industry is undergoing considerable upgradation and change.
It has been forecast that the Indian food and beverage packaging market is set to cross $122 billion by 2025 from about $26 billion in 2019 at a CAGR of nearly 30 percent.
Government tightening norms
The packaged food industry would receive a further boost with food regulatory authorities increasingly raising the bar for quality and hygiene for sweet products and snacks category.
In February this year, it was reported how local sweet shops had to mandatorily display ‘best before date’ and the ‘date of manufacturing’ on non-packaged and loose sweets kept in a container or tray. This is a more stringent norm than the existing labelling rules, which required these details for pre-packaged sweets only. Such measures could only add to the push for the packaged food industry.
The government is also adopting policies to promote recyclable technologies for packaging, prompted by sustainable environmental concerns.
Therefore, as COVID-19 has precipitated an all-out migration to packaged food away from open, loose, and perceivably unhygienic food and snack culture, packaged sweets and confectionery category would impart the strongest push to the packaged food industry.
Despite the recent societal and consumerist drive for healthy and nutritional snacking, the sweets and mithais would continue to form an indispensable part of India’s food culture, which, in turn, would give a sustained thrust to the packaged food industry.
Given that small packs of Rs 5/10 contribute to 70-80 percent of the sales in the snacks category, this is encouraging. After all, guilty pleasures can be derived from small packs, since once can never really wish them away.